11/21/2011

Greece Eyes EUR60bn In Uncollected Taxes

Presenting the European Union task force’s first quarterly report on debt-ridden Greece, head of the force Horst Reichenbach underscored the importance of addressing the sensitive and urgent issue of tax collection and evasion, noting that an estimated EUR60bn (USD81bn) in uncollected taxes are still outstanding.

Set up in August by European Commission President Jose Manuel Barroso, tasked with supporting Greece in implementing its painful economic reform measures, the special force maintained in its report that between EUR6bn and EUR8bn in outstanding taxes are considered to be immediately collectable, thus enabling the country to significantly reduce its widening fiscal deficit.

According to Reichenbach, around EUR30bn in uncollected levies are currently tied up in lengthy ongoing legal battles.

Underscoring the importance of strengthening the country’s tax dispute resolution mechanism, together with improving the Greek tax authorities’ technical ability to clamp down on rampant tax evasion, Reichenbach announced that work is currently under way to resolve the issue of undeclared deposits held by Greek investors in Switzerland. Here, Reichenbach underlined the importance of Greece successfully concluding a bilateral tax agreement with Switzerland.

Greece and Switzerland have reportedly initiated talks recently on concluding such a deal to enable the government to swiftly recover vital lost tax revenues. Greek wealth in Switzerland is said to vary vastly between tens of billions of euros and over EUR100bn.

Determined to recoup evaded taxes to help avert the imminent threat of bankruptcy, in its latest ultimatum the Greek finance ministry recently urged individuals alleged to have evaded taxes in excess of EUR150,000 to declare their position to the country’s tax authorities and to settle their accounts. Failure to do so within the specified timeframe would lead to publication of individual names, the ministry warned.

Back in October, Greek Finance Minister Evangelos Venizelos announced plans to publish the names of around 15,000 individuals, alleged to have evaded taxes in Greece.

Describing tax evasion as a "national crime", which has resulted in a shortfall in tax revenues for the state of around EUR37bn, Venizelos confirmed at the time that it has now been possible for the state to successfully track down individuals said to have evaded over EUR1m in tax.

Revealing that Greek tax officials in collaboration with private companies would now endeavour to recoup the money, the minister also emphasized that a new task force has been set up charged with auditing the thousand biggest companies in Greece in terms of turnover.